Working alongside Republican Idaho Sen. Mike Crapo, the chairman of the Senate Banking Committee, Montana’s Jon Tester helped to author the Economic Growth, Regulatory Relief and Consumer Protection Act. While opposed by many in his own party, the bill flew through the Senate and is expected to do the same in the House, putting it on President Trump’s desk in the very near future.
The bill proposes a significant rollback of the 2010 Dodd-Frank Act, created in response to the financial meltdown of 2008. The benefit for Montana, Tester says, is that the new bill would ease the regulatory pressure on small community banks and credit unions – which in Montana are numerous.
At the same time, stiff regulations would remain for the Wall Street banks.
“Those community banks are really, really important,” Tester said. “And what we saw happen after Dodd-Frank – and Dodd-Frank was put in for damn good reason, because the economy was ready to melt down, and Wall Street jokers were not doing what they needed to do. So it regulated them, and we saw regulatory bleed-down. And so these guys were put under a lot of additional pressure.
“In the end, what does this thing really do? I think it’s gonna allow banks to do their job, which is supply capital for economies that hopefully can continue to grow and employ people and move forward – especially in rural parts of our state, which are under a lot of pressure right now with consolidation.”
Tester met with a handful of Montana bankers and businessmen in a round-table format yesterday, and for the most part the bill received high praise.
Ben Ruddy, the president and CEO of Dutton State Bank, for example, said that they stopped offering mortgage lending services under Dodd-Frank. Should this bill pass, he said, it may again be able to offer mortgages.
There are, though, people who aren’t sure it’s such a great thing.
“It depends on who you talk to, truthfully,” Tester said. “I mean, there are some folks that think that banks are getting away with murder. They’re not. They’re still highly regulated. We got rid of some of the additional regulation on them, which I think’s going to allow them to stay in business and do their job.”